Ferrari president Luca di Montezemolo has issued an call for F1 teams, the FIA and the governing body to come together urgently to resolve the issue of costs in the sport.

With Europe teetering on the verge of a major financial crisis as the Euro is threatened by the Spanish debt situation, Montezemolo argues that the sport can no longer talk around the subject, but must put a plan in place.

The failure to agree an extended Resource Restriction Agreement was the reason why FOTA fell apart last Christmas when Ferrari and Red Bull withdrew taking Toro Rosso and Sauber with them. The RRA served a purpose up to a point, but was fraught with problems as the big teams all found ways around it, particularly in the last 18 months.

It has been a subject on the agenda ever since the break-up, but now with many of the teams feeling the pinch and some target companies holding back on sponsorship deals due to uncertainty over the economy, the situation is acute.

With the June 30 deadline looming to bring in a new FIA regulated plan in time for the 2013 season, the Ferrari boss says that all parties need to act now in the interests of the sport.

“The world economic situation and that of Europe in particular, is very serious and the world of Formula 1 cannot ignore the fact,” he said on Ferrari.com today.

“We cannot lose any more time: we need to tackle urgently and with determination the question of costs. Ferrari is in agreement with the FIA’s position that drastic intervention is required.

“We are absolutely convinced that, as I have always said, the teams and the commercial rights holder must work together with the Federation on this front. This is no longer the moment for getting bogged down in sterile discussions or the meanderings of engineers, usually only concerned in defending the interests of someone or other: the question has to be tackled at the highest level, without further delay.”

The smaller teams argue that a cost cap is the only effective solution; teams would be given a budget limit, controlled by the FIA, but they could spend the money however they want. Drivers, marketing and engines would probably have to sit outside of it.

At the same time, the subject of the cost of the 2014 engines is also on people’s minds, with some factions within the sport keen to see introduction of the new generation 2014 engines delayed.

As with all new technology there is significant development cost and although the two main engine manufacturers in F1, Renault and Mercedes, want to go with the new generation engines, there are plenty of people, led by Bernie Ecclestone, who don’t.

The fear is that the cost will be passed on to customers and that will be prohibitive for smaller teams.

Mercedes’ Norbert Haug admitted that there would be up front costs for teams, “It’s a bit premature to give a figure, but we should realise where we are coming from. The engines cost twice as much 10 years ago as they do right now and that’s due to the hard work of the manufacturers in the first place. It’s absolutely clear that if you introduce a new engine it will cost more in the beginning,” he said at the weekend.

“What we should do is consider a five-year period where the target is close to current spending levels and I think that’s achievable.”

Watch out for quite a bit of behind the scenes action on costs in the next two weeks as that June 30 deadline approaches.

You may also have noticed that placed drivers often put a watch on before going out onto the podium – that’s not because they’re worried about missing their flight home!

This sponsorship stuff can get a lot worse than wearing sunglasses and watches… last year in World Superbikes many of the riders would take a long draught of their sponsor’s beverage before answering the first question in the post-race press conference. I found that very irritating. Haven’t seen it so much recently so perhaps the organisers have put a stop to it.

I miss the days when it was OK for a hot and tired driver to leave the collar of their overalls open after a race!

I saw a podium ceremony recently in which every driver had an “assistant” with a pile of caps on the podium. The driver would put on a cap and receive a prize (a product from the race sponsor, I think). Then, the assistant would hand the driver a second cap and the driver would receive giant cheque. Another cap for the trophy and yet another for the champagne. At one time, one driver had two caps on!

Instead of annoying though, I thought it was very, very funny. AND: it pays the bills.

Made me wonder what I’d put myself through to keep my dream job as these drivers have to do.

PS: it was not as funny as the podium goers in the Indy race in Brazil (ex-F1 Takuma Sato included) struggling to pop the corks from their beverages.

@DB: ah yes, the old “two caps” scenario That was surpassed at the Isle of Man TT this year though, where John McGuinness was simultaneously wearing an impressive 3 caps on the podium after winning the production race!

Anyone missing a Briatore fix should watch ‘The Four Year Plan’ about him attempting to run QPR. Hilarious bull-in-a-china-shop stuff, especially when his own player says “The past 3 years have been a total nightmare” before manager Neil Warnock lunges over to grab the mic off him. Perhaps Flav needs to manage Maldonado, he’s quite good at bringing out a safety car!

Indeed. I dare say there are more than a few sponsors who signed huge contracts with teams a few years ago, who today would love to re-negotiate their deals, or even pull out of F1 altogether. I can’t help but think a great upheaval is brewing in F1.

Ferrari talking about cost reduction – I don’t think so. This is a Trojan horse for Luca to pitch up in a few days time and pitch for;
1. Change in the 2014 engine regs to suit maranello
2. Change to allow 3 car teams and the return of ‘customer’ cars.

All in the name of cost reduction.

I’m not saying some of these ideas don’t have merit but we shouldn’t fool ourselves thinking that Ferrari have the best interests of the sport at the centre of it, Ferrari do what suits Ferrari without thought to competition or fair play. Smoke and mirrors. The Schumacher/Todt era brought ruthless self interest above anything else to do with the sport.

And if they don’t get what they want they will once again threaten the sport with the same old tiresome talk of withdrawal.

Could we all get stitched up by Luca and Todt this time?

What do you think James – calm before the storm?

Has the poker game just started and were in for a summer of politics….

Not if people continue to smoke Marlboros, who continue to sponsor Ferrari until 2015 I think.
And that will not be a small-chunk-of-cheese sponsorship deal. David S is right, they are just fine for cash and this is the beginning move in a chess game.

Ironic about Spain’s economic situation. In a couple of weeks F1 goes to the wannabe Monaco circuit at Valencia. I wonder how many yachts will be in harbor this year. Or more significantly, I wonder how many spectators will be at the track.

For a country in this position, it is a disgrace that such an event is being held (Spain has the highest youth unemployment by far of any western nation). The city council of Valencia must have to empty it’s coffers into Bernie’s wallet for this monumentally BORING race to take place.

You’d be surprised how well attended Valencia is: 85,000 spectators on Sunday race last year. I must admit it is a bit processional at best so you might as well be there to enjoy F1 for what it can be: loud cars and loud Alonso fans in the sun and heat of Spain.

To put it in perspective, it’s a bit less than Melbourne (114,000) but that’s two times the attendance in Malaysia or three and half times what Korea manages.

Saying that, it is rumoured they are likely to alternate with the Circuit of Catalunya which is struggling financially. Valencia is doing OK as far as I am aware.

and which of the teams do things for the sport and not themselves? Mercedes and Renault who threaten to quit the sport if the engines are not implemented? Is it them you are talking about?

Renault and Mercedes want these engines for themselves..not for the sport. These engines will bein line with their production cars.
Ferrari would prefer bigger engines as their cars are more powerfull than a Renault and stuff like that.

But let’s not throw the blame on Ferrari. Everybody wants F1 to turn in the direction that will suit their business better. In the end they need to get to a compromise. Nobody can have it all and nobody should have it all!

I would have thought Ferrari would be very interested in developing these engines as there is an EU law that comes into affect in 2020 that all models in a manufacturers fleet must have an average CO2 emissions of something like 105 g/km. Surely the only way Ferrari can meet this will be by developing these engines!

I have heard of a new British designed/built 200 mph super car with a 2014 engine spec that will not have to pay the London congestion charge (cos of its low emissions)! I think that’s pretty cool!!

Ferrari is part of Fiat and Fiat have lots of small cars like Fiat 500 and so on that have low emisions, therefore their average will not be a problem.
The problem was Aston Martin here in UK..but I believe they will start making a very small city car.

As an addition to Mister’s comment, Ferrari is part of an automotive group that includes, Maserati, Alfa Romeo, lancia, Chrysler, Dodge, Jeep and obviously Fiat.
Ferrari build maybe 7,000 cars a year, whereas the rest of the group builds into the millions.
As an aside, paolo martinelli runs fiats group engine design dept, ex Ferrari f1 engine designer, so technology sharing won’t be an issue and for anyone claiming Ferrari aren’t happy about the 6 cylinder engine because it doesn’t fit into their product line, you may want to consider,
1) the Ferrari dino was a 6 cylinder road car
2) Ferrari have raced with 4, 6, 8, 10 and 12 cylinder engine cars ever since they were established.
3) between 1981 & 1988, they raced a 6 cylinder turbo charged f1 car.

Ferrari will build whatever is needed to win, that’s why they designed a v10 for 1996 to replace the thirsty but gorgeous sounding v12

No i believe he’s genuine. Ferrari are not immune from the current European economic problems, nor is Formula 1. Capping costs is a must do. I am no fan of Ferrari (the accept money from Phillip Morris tobacco, bypassing advertising laws), but an idea must be assessed on its merits only. Cancelling the V6s is probably a bad idea now as teams have spent too much money on it. A short terms customer car or joint R&D engineering arrangement to reduce operational costs should be done to insulate the sport. If costs were reduced medium (5 year) deals could be offered to advertisers at a discount to ensure the continuation of the sport.
Personally i’m pretty cynical about this stuff but Luca hasn’t been touted for the Italian parliament for no good reason. Actually its the Redbulls and Mercedies of this sport who I don’t believe will play fair with cost-cutting.

When I think of Marlboro, I think of Senna in a McLaren or Schumacher in a Ferarri before I think of cigarettes.

For me, most cigarette brands are more synonymous with F1 than they are with the actual tobacco products they are pushing. I am not a smoker and I agree that there are health problems associated with it and there should be warnings and all that stuff. However, alcohol causes just as much, if not more societal grief than tobacco and there are no laws prohibiting outright the advertising of it. These companies have been loyal and reliable sponsors in F1 for decades, not like the tel-co’s or tech-co’s that come and go.

I think it was wrong that tobacco advertising was banned from F1. There shouldn’t be this situation of teams taking under-qualified pay drivers just to scrounge together some funding (Williams, HRT, Caterham).

Formula 1 at least, should be granted an exemption from these laws. It is very unique in that there is only one race in each country a year and it is a sport that requires large amounts of funding. But nevertheless, my comments on the issue are effectively moot as I don’t expect any of these laws to be rescinded any time soon or ever. Even to save the sport.

What’s wrong with accepting sponsorship from tobacco companies?!
The question is a joke, right? Must be.
You provide yourself the answer in your next two sentences….
It’s a shame that some people still don’t get it. So common sense is enforced by law.

Back in 2006 i remember taking my daughter to the British GP (she was 7 at the time) and we wandered through the entertainment areas and in the middle were scantilly clad ladies promoting Marlboro using high quality branded ‘giveaways’ with carefully placed ‘symbols’ for brand association between Marlboro and Ferrari and she actually handed one to my daughter, a 7 year old. Out of order to try and ‘hook’ a kid….

James you never did get back to me with the truth about the teams agreement to voluntarily remove tobacco sponsorship that was signed on that fateful day of September 11th 2001… of course one team didn’t sign it..good day to bury that kind of news i guess…

As someone who smoked for twelve years + has been a lifelong McLaren fan + loved Ayrton Senna in his Marlboro clad car from the moment I saw him drive, I see the connection as being pretty straightforward.

Even the brands I chose were connected to F1, I started with Marlboro (naturally), switched to Camels (maybe because Marlboro dropped McLaren?), and had a very short stint with West (because they started sponsoring McLaren?).

I know, you don’t have to tell me what an idiot I am to fall for that kind of advertising, but fall for it I did, nonetheless. I just didn’t see it at the time.

I love F1, but there’s no way that I would classify it as constituting some kind of ‘special case’. Ferrari are a bit dirty to keep their latent advertising connection with Philip Morris.

I have been somewhat shocked at the level of indignation concerning my comments on tobacco advertising.

I would be much more willing to accept such positions if there was an equal level of opposition towards alcohol advertising. McLaren have current associations with Johnnie Walker, Force India with Whyte & Mackay, United Breweries Group and Sauber with Plozza Wines. These are just some that I’m aware of.

I’ve never heard of any incidents of ‘smoke’ driving causing death but sadly I have heard plenty of drink driving incidents causing death. I’ve also never heard of tobacco related domestic violence but alcohol related, tragically all too much.

I’m not saying that these companies are responsible, certainly no more than tobacco companies are for lung cancer, etc. It comes down to individual responsibility.

If tobacco advertising is banned then undoubtedly so should be alcohol advertising. It is societal hypocrisy at it’s worst.

Monty has a point. But they are a manufacturer team unlike Red Bull or Sauber. A team like Ferrari can hide the cost by passing it into a different entity of the group whereas non manufacturers can’t do that.

Something tells me that the 2014 Ferrari challenger will not be ready on time. Hmmm …

As far as I read in the media, Ferrari are one of the teams who support the idea of FIA to get involved into RRA and to control the costs. RedBull are the ones who don’t agree with it.

And why you talking about the 2013 car when we haven’t yet seen the 2013 one, which will most likely be a continuation of the 2012 one?? I don’t understand you.

Unless you were refering to the 2014 engine that Ferrari should build. I am sure that none of the teams started on these engines yet. If they are still talking about these engines, than I am pretty sure nobody wants to waste money on developing something that might not be used.

I am referring to the 2014 engine. In case you are not aware, the engine developed by PURE is ready to fire up. If I am not mistaken, the Mercedes engine is also almost ready. Renault also started work on that a while ago and should be on schedule.

They have already. They wasted money on the 4 cylinder formula before the 6 cylinder compromise.
Everyone knows that the 6 cylinder turbo is the way of the future for Formula One. Ferrari don’t like it but they will have to join the group this time.
However, they might be able to twist enough arms in the process to get their wish for customer cars. I think that’s LDM’s primary goal.

whatever luca – your posturing is as bad as bernie’s. you left fota instead of trying to work things out. you went in the huff about having 4-cylinder turbos so that had to be reworked. you want endless in-season testing on your private racetrack. whatever. we know what you want, and it’s what suits you, nothing more, nothing less.

He’s very fierry isn’t he, Luca. If Ferrari get a 10 place penalty when it should have been a 5 place he’ll threaten to start his own series off.

Do other teams just treat his tirades with comtempt? I’m suprised no-one stands up to Ferrari more than they do. They practically went to war when the three new teams wanted to sign up. (probably because they wanted to have 3 cars, or whatever)

If costs are really a problem, F1 would do well to see what they could learn from the Indycar model. The lower teams should be able to buy part kit cars from some of the bigger manufacturers. I’m sure some kind of a system could be put in that would give the reduced costs of Indycar, but not quite so many technical restrictions.

Some of the “smaller” teams already get some of their stuff from “big” teams (e.g. Force India & McLaren).
This is a good thing all round IMHO. The big teams lower their costs, and the small teams get a more reliable car, and lower their costs too.

I agree. Kit cars goes against a lot of what F1 is about, but if they truly need a cost cap to survive this economy that may be the only option. Freed from the costs of developing a chassis, teams could focus their resources on developing the aero package which appears to be the biggest factor separating the cars anyways.

I have no idea to what extent the construction of F1 cars provides employment in Europe, but I know there are also many people employed in secondary industries such as ticket sales, tv revenues, media, marketing etc. How many more people than just engineers would be out of work if F1 started to circle the drain because it couldn’t cope with rising costs?

The basic principle is that you can build something fast, you can build it good or you can build it cheap. But it is only possible to build something that meets two of those goals.

If F1 must cut current costs (ie; build the cars more cheaply), then either the quality of the cars or the speed with which they are designed, built and routinely modified will inevitably suffer. Maybe both since they are interrelated.

The bottom line is that no matter how costs are cut, it is inevitable that the innovation we are accustomed to will be negatively affected. So it is arguable that it is better to admit this openly and then solve it by having a few excellently designed customer cars than a grid full of unique but cheaply designed junk.

Wasn’t it L di M who wanted to enter 3 cars not that long ago ? So is it too cynical of me to wonder if the boss of the team which has consitently outspent the others, the team which carried on taking Tobacco money after it was supposed to be banned, and the team which gets extra money from the commercial rights because they’ve been there longer is acting purely out of altruism, or if this is just a bad week to have a Spanish bank as a major sponsor.

Do we really expect any team to argue for a limit far below the sponsorship they can raise? If the economy is bad and the available sponsorship is down, everybody needs to trim their budgets. If a deal cuts the cost to Shell or Santnder, or Acer of having their names on Ferrari it will reduce what is available to the smaller teams. Halving Ferrari’s budget wouldn’t make them a lot slower – because a lot of the spending is huge expense to find tiny amounts of time. Halving what sponsors pay a smaller team might be the difference between having a car to go racing and having none.

Quite frankly Luca is playing a game, he wants the engine rules to remain the same (as does Bernie), the new engines are going to be much more expensive so a cost control apparatus will help reduce the chances of the new engines actually appearing. Luca would be very happy indeed if Mercedes and Renault left the sport, as those engines are its direct competition. Pus of course the deal already done with Bernie enables Ferrari to have yet more financial advantages over its rivals…

Luca should know that we remember how strongly he opposed any financial restrictions just a few years ago…

“Luca would be very happy indeed if Mercedes and Renault left the sport, as those engines are its direct competition.”

Now that’d be funny, if McLaren wins with a Ferrari engine (McLaren did say they do not wish to build their own engines for F1), then it’d be a bit like Boeing v Airbus, every McLaren win was delivered with Ferrari power lol.

In the days before the RRA Ferrari and Toyota both spent in the vicinty of half-a-*billion dollars per season! And I don’t think it included the marketing and drivers’ salaries! As I’ve said may times, they could have had their own *fleet of atomic submarines by now!

That’s why Ferrari left the RRA last year. Because spendings by RedBull. And the RRA could not do anything to sanction them about it, therefore Ferrari said RRA is pointless if rules are broken and sanctions not applied.

This talk of cost controls is so hypocritical, it would be laughable if I wasn’t a lifelong fan of F1. The overriding factor in this call for a reduction of costs has nothing to do with helping smaller teams or the economic situation.

Reducing costs means more profits for those involved. As with anything where multimillionaires are involved, it’s really all about greed.

Where does the money come from in the first place? From consumers – consumers of F1 (the fans) and consumers of manufacturers’ and sponsors’ products.

Has there been any thought given to reducing ticket prices if cost are lowered for the teams? NO. Any talk of it costing race promoters less to stage a race? NO. Any talk of any benefit to the fans of F1, who really supply the money to begin with? NO.

It’s just like every business in the world today. How do we maximize profits, even if that is at the expense of our customers or fans?

Greed, pure and simple.

I would really rather there be no cost controls at all. If you can’t afford to compete in F1, you shouldn’t be there in the first place.

It would be great if F1 was run just as a sport, only making enough money necessary (and that should come from sponsor advertising) to keep it going. Tracks should not have to pay to host a race, just provide an F1 quality facility. F1 gets a venue and the track can sell billboard space. Fans would then get significantly cheaper tickets. Team merchandise should be priced only to sustain costs, afterall, merchandising is more advertising for teams and sponsors anyway.
Investing in the fanbase is how it should be viewed. Finally, pay tv should not be allowed to broadcast F1. Only free to air. Just a few basic things.

But I’m sure all this is a utopian fantasy on my part as we live in a world driven by greed for more and more profit. Maybe there will be a miracle and Bernie will Will F1 over to the FIA to be run in a way that returns the purity of building cars and racing them to F1.

Jeff, to me the term “cost control” means the amount of money a team has to spend to build and develop a car in a season. That has nothing to do with the tickets prices.
The ticket prices will be lowered only if the demand is reduced year by year. As long as we, the fans, are prepared to pay £315 for a 3 day ticket at Silverstone and the venue has to add another grandstand because the initial tickets almost sold out, they will never drop the prices.

Also, in my un-informed opinion, I am not sure the teams have a say in ticket prices. It’s the circuit owners that decide that. They paid a fee to Bernie and now they decide on a ticket price that will attract enough fans to recover their costs. This is all marketing.

I always wonder what’s the big deal when people talk about programs moving from BB1 to BBC2 or vica versa. What, really, is the big deal? It’s not like there’s more people who have one channel over the other!

If you remember when the Malaysian GP switched from BBC1 to BBC2, that had a big reduction in viewers, and as the teams AVE sponsorship rating relies in the number of viewers, it’s pretty significant …[mod]

Methinks they should ditch the new V6 architecture and do what they did for the switch from V10s to V8s — lop off two cylinders and get a 1.8 litre V6. The re-tooling would be minimal, the cylinder head research would be proven (though the V6 would be 90 degrees, so that might be problematic). The main cost would be turbo tuning. An all new engine is an expensive engine, no matter if it’s greener. Why not keep the V8s but limit fuel? Or keep them, but add turbos and drastically reduce revs? These would be far cheaper than all-new engines.

No, not an engineer, but I’ve rebuilt plenty of engines. What would preclude chopping two cylinders from the 2.4 litre V8 for use as a 1.8 litre, turbocharged V6? The crank will of course have to be altered, but that’s rather simple engineering compared to a whole blank sheet design where different bore/stroke ratios would be explored and different combustion chambers would be tested. The intake and exhaust would have to be redesigned, of course, but that’s relatively cheap compared to investing in tooling to build a new engine architecture. The final bonus would be proven reliability and known metrics for durability. I see it as win-win on many fronts.

Has anybody put together a list of how much the current F1 teams are spending or planning to spend for the whole of this season? Or maybe there’s one for last year? It would make interesting reading, and I wouldn’t mind betting Ferrari are pretty near the top.

Honestly, a lot of the teams have always been on the financial, a lot of the backers have always been able to walk away (and have), and the cost to fans as far as race event prices have always been high.

For much of the world the cost to watch it on TV (at least live) isn’t entirely new either, getting live free to air broadcasts back home in Australia only really occurred over the last couple of seasons.

To me it just seems like the same game of musical chairs that has been going on for at least 30 years.

Sorry, but I can’t remember a time when F1 wasn’t broadcast for free and live in Australia. Channel nine had the rights for most of the nineties and Channel ten, AKA One HD, has had the rights for several seasons now.

2000 years ago when the Roman legions were conquering the known world there were many battles. During the battles the messengers would bring current information to the generals. When the news was bad, sometimes the first thing the generals did was kill the messenger. Then they dealt with the problem at hand. In this case many do not care for the messenger or the messange. I believe it would be a mistake not to consider the problem at hand.

One way to reduce costs would be to freeze the current regulations for say, 5 years. No changes to engines, cars would essentially be the same – not exactly what current F1 is about, but this year is proving to be fantastic so why not leave everything where it is?

Over time the smaller teams will catch up to the leaders and make things even closer and everyone saves tonnes of cash in the process. When the global economy has recovered, the rules can be changed.

Actually I’ve always wondered why is there a NEED to design new cars every year?

Say post 2010, a year where there was fierce competition and everyone so close, 2011 could’ve carried on with same / 99% similar cars and still have fierce battles. Instead we were given a boring year due to Vettel/Newey’s dominance.

All the teams have spent two years agreeing on these new rules. 100 million has been spent by Mercedes and Renault- God only knows how much money all the teams have already invested on R & D. That’s why not !
Also I think f1 needs to be more relevant and develop new technologies and efficiencies – turbos with ERS (energy recovery systems) is a good start.

I don’t think anybody is suggesting that. F1 should definitely look at the Indycar model and see what they can learn. Engineering innovation inevitably comes at a massive cost and at its extreme would just result in the richest teams winning all of the time.

F1 doesn’t need to go to the Indycar extreme, teams should be free to build their own cars, but if they want to compete with a customer car I don’t see the concern really.

Maybe LM (Why do people insist putting the “de” in his nam? He has said he doesn’t use it or want it in his name. Apparently it was a creation of reporters – like GT40) should do some market research. Maybe he’ll discover Ferrari customers will buy a Ferrari with a V4 with a turbo strapped to it. I reckon as long it sounds good and goes like stink they’ll not care too much. Would it not be a good idea trying to attract more companies into the sport? I know that is what the cost-cutting in part was designed to do but it is not working. There are currently only four engine suppliers in F1 that could change and get them to supply the teams with smaller budgets.

It’s like say some people have surnames “Scott-Long” for example, surnames taken from both mother (Scott) and father (Long) in the past which used to happen. You can’t call him/her just Scott or just Long, it’s “Scott-Long”.

Fair point regarding the di instead of de issue, I could not see his name when I was typing and could not be bothered checking. However, I think you did not understand the point I made. I was not questioning the use of the di per se just in Luca Montezemolo’s case. If you read the Wikipedia article you drew my attention to you will discover I am right. To add further weight to my argument please follow this link –http://fakeferrarinews.wordpress.com/the-ferrari-team-profile/meet-luca-di-montezemolo/.

It may not prove my point conclusively but it does show his reluctance for the formalising of his name. Next time you try to correct someone please understand their point first. If you do not, ask them for clarification. If you know you are right, provide proof.